OC City Faces Bankruptcy, Unincorporation As Revenues Plunge

STANTON (CBS) — More than one year after declaring a “fiscal emergency”, officials in the city of Stanton warned Monday of drastic reductions to public services in the face of an annual deficit of over $2.8 million.

Sales tax revenue in Stanton has plummeted by 30 percent since 2006-07, while property tax revenues have sunk to their lowest level in 8 years, fueling a deficit that City Manager Carol Jacobs has projected to continue growing until the city’s coffers are depleted in 2016.

In April, the City Council made across-the-board cuts to services including parks and recreation programs, graffiti removal efforts, and funding for school crossing guards and after-school programs.

But despite the challenges facing the city, Jacobs said the state has made the situation even worse by killing redevelopment agencies and borrowing tax revenue intended for the cities and counties.

“They continue to siphon off any kind of taxes that they can from us, and it just makes it extremely difficult to deal with our limited resources,” said Jacobs.

She recently issued a public letter to residents of Stanton warning of bankruptcy before voters defeated a measure to increase the city’s existing utility user tax from 5 percent to 7.5 percent.

Jacobs also predicted Stanton would become an unincorporated “island” of Orange County resulting in reduced police, fire and emergency medical services, along with a potential impact of scaring off any business owners “if they believe our town is not safe or its future is uncertain”.

Stanton was first incorporated as a city in June of 1956 and currently spans across three square miles with approximately 38,300 residents.

Regardless of the city’s fiscal challenges, however, Jacobs remains optimistic that recent developments in Stanton point to a brighter future.

“A prettier place to look at, a prettier place to live, a safe place to live,” she said.